Prometheus 6   

If you're not part of the solution

Look Who's Piling On
Monday, December 22, 2003; Page A24

NO SOONER HAD Virginia Gov. Mark R. Warner (D) outlined a thoughtful tax reform-budget package than out with harsh criticism came the last two people who should be taking potshots: former Republican governors James S. Gilmore III and Sen. George Allen. Their collective financial record during a period of extraordinary economic growth managed to stick Virginia with unprecedented deficits that Mr. Warner has spent most of his time trying to erase.

Mr. Allen was fortunate to enjoy boom years during his term. But he pushed for a tax cut that the General Assembly turned back when business leaders objected strongly. They said the cut would have done serious damage to the financing of education, which would harm Virginia's reputation as having a first-class education system and in turn hurt efforts to attract and retain businesses. Mr. Allen also incurred substantial debt service costs with bonds for extensive prison construction. He turned to cuts for the Virginia Department of Transportation, leaving it underfunded and poorly managed, papering over cost overruns and running up debt service to a level that by 2006 may reach 9 percent of the transportation budget.

Mr. Gilmore rode into office on a pledge to repeal the car tax, which proved to be an immensely popular and devastatingly expensive idea. Growth would cover the cost, he said; but by the time he left office, Mr. Gilmore had mortgaged Virginia's long-term future to finance short-term gains. At that point, in January 2002, the state had roughly $1.5 billion less than it needed to cover costs for the six months left in the fiscal year; and for the biennium to follow, the state was looking at forecasts showing it to be about $2.3 billion shy of what it would need merely to maintain current services. Mr. Gilmore's insistence on cutting the car tax in the face of a recession that was obviously underway was responsible for much of the shortfall. He also borrowed heavily against future revenue and relied on accounting gimmicks to cover transportation and other programs.

Such was the bad hand dealt to Mr. Warner, not to mention to local government leaders who had to make up for lost state aid once Mr. Gilmore's car tax plan began devouring the state budget. For counties, that has meant higher property taxes. For the first budget rounds, Mr. Warner took to cutting and pasting and exhausting any remaining accounting gimmicks. All along, the need to overhaul Virginia's antiquated and unfair tax code was as obvious as it should have been to Mr. Warner's two predecessors. Now, the governor has taken the lead, with a formula that most Virginians may find even lightens their tax burdens while generating money for education and other essential services.

The tax and budget proposals are sure to generate debate in the General Assembly. But the governors who deepened the financial hole are hardly the best counselors to sit in the critics' corner.